Taxation (Budget Measures) Act 2010

76 New heading and section DB 64

• (1) Before the heading to subpart DC, the following is added to subpart DB:

  “Capital contributions

  “DB 64 Capital contributions

  • “When this section applies

    “(1) This section applies if,––

    • “(a) a person has derived a capital contribution after 20 May 2010; and

    • “(b) in the absence of this section, the person would be allowed a deduction for an amount of depreciation loss for an item of depreciable property for which the capital contribution is a contribution (see: definition of capital contribution); and

    • “(c) the person has chosen to apply this section in a return of income for the income year in which the capital contribution is derived.

    “Deduction

    “(2) For the purposes of quantifying the amount of depreciation loss for the income year under subpart EE (Depreciation), the item's adjusted tax value, base value, cost, or value, as applicable, is reduced by the amount of the capital contribution.

    “Links with subpart DA

    “(3) This section overrides the general permission.

    “Defined in this Act: adjusted tax value, amount, capital contribution, deduction, general permission, income, income year, return of income”.

  (2) Subsection (1) applies for capital contributions derived after 20 May 2010.